In a free economy the central problems facing a society are solved by _________.

market forces or price mechanism

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central planning committee

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central bank

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parliament

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Solution

The correct option is C market forces or price mechanism
In a free economy the central problems or the problem of choice faced by an economy is solved by the free flow of two market forces-demand and supply. Thus, the market itself draw itself to the equilibrium level and solves the surplus and shortage problems.

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